I am a little confused on the situation. I agree she is not a good person, but is this an official university group or is this a group of people who get together and who happen to also be employed by the university? Are they all from the same university? If she just stopped having the group or just stopped running it from the university (they meet at her house or a coffee shop instead of using university space) what would happen from the university - would they replace her or the group with a new leader/group?

The univ. that I work for actually did the same thing in a faculty on faculty stalking case - they offered to send them to a counselor. Victim chose to leave instead because no matter the outcome-staying was untenable. It was horrible and we lost a great colleague and kept a highly disliked nutbucket one instead.